Analysts at J.P. Morgan have said that a decline in demand for smartphones will affect growth at Apple and Qualcomm.
That forecast led the company to remove both Apple and Qualcomm from its list of most preferred shares.
J.P. Morgan added network equipment suppliers Arista Networks and Ciena to the list based on the forecast that demand for telecommunications and cloud applications will continue to grow.
The removal of Apple and chipmaker Qualcomm from the broker’s “Analyst Focus List” is triggered by several factors that could affect demand for smartphones, including the new coronavirus lockdowns in China and inflation caused by the ongoing war in Ukraine.
According to the Nikkei newspaper, Apple is working to reduce iPhone and AirPod production due to a drop in demand. The company plans to produce 20% less iPhone SE while reducing 2022 orders for AirPods by more than 10 million units.
Apple is expected to launch a brand new range of iPhones later this year, but analysts say it is too early to predict any impact on the upcoming range.
For more information, read the original story in Reuters.